COBA campaigns for competition ahead of election

A “Competition Agenda” has been published by the Customer-Owned Banking Association (COBA), aimed at shifting the public focus onto issues of competition in the banking and financial sector.

COBA’s Competition Agenda calls on all incumbent policymakers and candidates to adopt a four-step agenda, which include:

• Empowering consumers by raising awareness and reducing barriers to switching
• Accommodating the customer-owned model
• Improving regulator accountability and regulator focus on competition
• Recognising the anti-competitive impact of regulatory compliance costs and ensure regulatory measures are proportionate and targeted

COBA CEO Michael Lawrence claimed that enhanced competition would be a solution to the “endless cycle of misconduct in the banking sector”.

“The [banking] royal commission has put the spotlight on banking conduct; it’s now time to shift the focus to banking competition. Without robust competition, the big four will continue to put their customers last,” Mr Lawrence said.

“If the big four aren’t scared of losing their customers, they have no incentive to start treating them better and putting their interests first.”

Mr Lawrence added that COBA’s campaign would help better inform Australians about the positions of candidates when they cast their vote in the upcoming election.

“As the federal election looms, many Australians will want to know what candidates and parties will do to fix the banking sector,” he said.

“COBA’s Competition Agenda provides all candidates with a straightforward roadmap to improve competition and improve customer outcomes.”

He concluded: “Now is the opportunity to implement the legislative and regulatory frameworks to improve competition in the banking sector.”

Mr Lawrence recently welcomed the passage of the Treasury Laws Amendment (Mutual Entities) Bill 2019 through both houses of Parliament.

The bill includes a new definition for a mutual entity as a company where each member has no more than one vote, changes to demutualisation rules to ensure that it is only triggered by an intended demutualisation, not by other acts such as capital raising, and the creation of a mutual-specific instrument that can be used to raise capital.

 [Related: New bill to level playing field for mutuals]